By Glenna Nyamwaya
The International Finance Corporation (IFC) has expressed interest to work alongside Bangladesh drug maker Square Pharmaceuticals, which commenced construction of a new plant in Athi River early January.
IFC, the private business arm of the World Bank is eyeing an equity stake with the Asian firm following the rejection of an initial proposal by the IFC for some shareholding in the Square Pharmaceuticals Kenya EPZ Limited plant. Square Pharmaceuticals managing director Tapan Chowdhury said the pharmaceutical company instead opted for a partnership with Standard Chartered Bank to fund the project through a loan deal.
“Of course the IFC wanted to have equity, but really we don’t need that,” he said. “IFC has some contribution through Standard Chartered Bank, and so together they have injected 60 per cent of the funds into the project. We have brought in money from Bangladesh also through our bank”, Chowdury added.
The pharmaceutical firm started construction work of its state-of-the-art pharmaceutical manufacturing plant in January 2018 at the tax-friendly Export Processing Zones (EPZ) in Athi River with an initial investment of Sh2.5 billion.
The total cost of building the plant, set for completion in July 2019, is projected to cost Sh7.5 billion with an annual capacity of two billion tablets and 60 million bottles of liquid medicines. In the initial years of the plant’s operations, the Bangladesh leading drug maker plans to utilise about only a third of the plant’s capacity.
This will later be expanded to full capacity based on both local demands in the country and exports to the Common Market for Eastern and Southern Africa’s (COMESA) 400 million population.
“Well, we work in stages. Eventually when more money is required we will invest in it. This is just a start,” head of World Bank Group’s Health in Africa Initiative and the group’s lead health sector specialist Khama Rogo noted.
Rogo was optimistic that in the near future the IFC would reach a deal for an equity stake with the leading Asian drug maker. The firm looks to bring into play world class technology of pharmaceuticals manufacturing, quality control and state- of-the-art machineries in Kenya.
This is aimed to fill the unmet demand of medicines within the East African Community (EAC) market made up of Kenya, Tanzania, Rwanda, Burundi, Uganda and South Sudan.
Products of the plant will be pre-qualified by the World Health Organisation (WHO) before being supplied throughout Africa eventually. Commercial production of the pharmaceutical products is expected from first quarter of the year 2020.
